A web full of knots

Which actors should be present to get a complete picture?

Because the economic reality system (ERS) intends to represent the reality based on all flows that can be established and distinguished, they have been arranged in the layers we have distinguished and the three categories of transaction (flows) that happen between them: ecological, barter, and financial transactions.

We don’t present separately nature / earth, the omnipresent structure, that is essential for all other structures, for it is, so to say, the background on which we project all other structures.

Speaking about the societal development we stated that the life of an individual in a highly developed society takes place in a system, in which all three inseparable dimensions – the social, the economic, and the political / solidary – are somewhat more visible separately then in the original situation, in which those dimensions were almost completely embodied in the family entity.

That’s why, beside the families, we consider as separated categories also the entity groups that take care of the political / solidary dimension (the authorities) and parts of the social dimension (social / non-profit).

On behalf of their recognizability and their connection with the layer scheme we separate the other particularized non-family economic entities in industry, services and trade on the one hand, and banks, insurances and holdings on the other.

A colourful collection of balls with lots of wire connections

We can imagine a political house (as a collection of a number of entities) as a large bordered box, the bottom of which is covered by balls of all sorts of colours and formats, where each of them has a number of wire connections with other balls of the own group and/or of other groups, ánd with the bottom – the earth – as a separate ecological entity.

The wire connections, in different types of wire in accordance with the type of physical flow or financial flow, represent the flows occurring between the entities; those connections can be as well lasting and strong as thin and unique; the more lasting connections can also get shifted and/or vary in number in the course of time.

The reason why all kinds of economic entities are represented as balls is that they all fulfil the same three functions, albeit with specific own accents. (Further explanation can be found under menu-button ‘3 essential functions’). They never appear as loose elements for they are always knots in the wiring of the web.

The smaller balls, greyish in colour, stand for the family entities. The other groups of entities (enterprises, social-profit, the government, the financial sector) have their own, but somewhat varying colours.

The size of the balls, which stands for their economic weight, can vary in time: while now and then new balls appear and other balls disappear, existing balls can shrink as well as grow bigger, and some of them can suddenly explode / implode and disappear (bankruptcies).

Family entities (the grey balls) are the only group with the property of being able to remain for a long time in the shape of a dot (poor families, which have to be supported by the community / the societal system).

The representation of the actors can be seen under the menuknob ‘knots’. The wire connections (flows) are not represented.In the ERS-logo (to the right top corner of these website pages) each of the different entity groups is represented by one coloured ball (see legend at the knots scheme). The arrangement reflects the ERS vision on society: the families are the central entities, and the other, non-family entities, are at the service of the family entities.

A busy, but nevertheless neatly arranged representation

By this representation we see the societal system as an intricate, colourful, and continuously moving and transforming clew. But because in the meantime we get an insight in the component parts, the clew is no longer an untransparent complexity for us, but a rich and ever changing variation of a known pattern.

The characteristics that we cannot yet see at this level – the three essential functions and the three categories of transaction – will become visible when we look at the structure-and-working model that is present inside each of these balls.That model is named ‘universal enterprise model’ (UEM), because it is valid and usable for all sorts of economic entities regardless of their size and/or nature. It will also become clear that the balls are no passive flow pipes but are active pumping-devices, that can influence the throughput.